UGANDA has agreed to partner with the East Africa regional states and foreign investors to construct a $2b refinery. The move is aimed at processing petroleum products to meet the regional energy needs.
Fred Kabagambe, the energy ministry permanent secretary, said the refinery would process a wide range of products, including diesel, petrol, kerosene and aviation fuel.
“We shall start with the first phase of 20,000 barrels daily to meet local demands. We shall then upgrade the facility in the second phase to produce 60,000 barrels a day. Later, we shall have a bigger one processing more that 120,000 barrels a day,” he said.
Kabagambe explained that the refinery would be located in Kabale. The ministry was in the process of searching for a consultant to carry out studies for a pipeline that would transport petroleum products from the Lake Albert region, he added.
Kabagambe said the feasibility study on refining of crude oil had been undertaken, indicating “profitability and high returns on investment between 20 and 30%”.
The announcement comes after Uganda, Kenya and the Democratic Republic of Congo signed a memorandum of understanding aimed at co-ordinating oil exploration and development in the Lake Albert basin, located along the Uganda-Congo border.
Uganda and Kenya also talked about building the Kampala-Eldoret pipeline, which would continue to Kigali in Rwanda.
Claude Nsengiyumva, the East African Community (EAC) deputy secretary-general, said the decision to have the refinery built in Uganda was part of the region’s natural resource policy and objectives.
“This oil belongs to both Ugandans and the East African people. We want to share resources and be able to reach where they are located,” he said during a media briefing yesterday.
The brief was held to discuss the upcoming 5th East Africa Petroleum conference and Exhibition, which will held at Kampala Serena Hotel starting today and ending on Friday.
Uganda is hosting the conference for the second time. It is held every two years in the member states on a rotational basis.
The conference focuses on the potential and investment opportunities in the oil and gas sector in East Africa.
Over 800 participants, including government leaders from the EAC member states, international oil companies, together with researchers and investors are expected to attend.
Simon D’Ujanga, the energy state minister, said this year’s theme is “harnessing East Africa’s oil and gas potential and utilising the resources to create lasting values”.
“This is the time the EAC is moving towards creating a common market. This will promote full exploitation of the market and investment opportunities created by the community,” he said.
“Secondly, Uganda is moving towards commercial petroleum production. This, therefore, offers an opportunity for Uganda to show the world her progress in the oil and gas sector.”
Last year, the EAC launched its own common market, where free movement of goods, labour and capital within the region was endorsed.
The minister said the meeting would provide participants with an opportunity to assess their development in the petroleum sector and also explore varied attraction in the region.
